Washington Week: Part B Premiums to Rise Slightly in 2012

WASHINGTON -- Seniors will pay a little more for their Medicare Part B monthly premiums in 2012; the House passed a bill to block a 3% cut in pay to "contractors," including doctors; and the FDA released data that showed the stop-smoking drug varenicline (Chantix) doesn't appear to lead to hospitalizations for psychiatric events.

Part B Premiums Increase Slightly

Monthly premiums for Medicare Part B will be about $100 in 2012 -- a 3% increase over 2011, but lower than what was projected, the Department of Health and Human Services (HHS) announced Thursday.

Seniors and people with disabilities enrolled in Medicare's Part B program will pay $99.90 per month in 2012. They currently pay $96.40 each month for Part B, which covers physicians' services, outpatient hospital services, certain home health services, and durable medical equipment.

Earlier this year, the Medicare trustees projected monthly premiums for Part B would be $106.60.

Part B deductibles, which is the amount beneficiaries must pay for healthcare services before Medicare pays, will be $140 in 2012, $22 less than it was this year. Once that deductible is reached, beneficiaries are then responsible for a 20% co-pay for each service performed by a participating provider, with no annual limit on out-of-pocket costs.

House Votes to Repeal Law that Would Have Cut Doc Pay

The House of Representatives on Thursday passed a bill to remove a widely-opposed tax withholding requirement and another bill to offset the costs of the repeal.

The tax withholding bill, HR 674, would eliminate a yet-to-be implemented requirement that the government withhold 3% of payment to government contractors, which would have included doctors who contract with Medicare and Medicaid. The bill will be paid for by another bill, which would modify the way adjusted gross income is calculated. It stems from concerns that its too easy for middle-income people to qualify for Medicaid and other health programs intended for the poor.

The American Medical Association (AMA) applauded the passage of the bills. "This additional burden is simply untenable in our current Medicare system," Peter Carmel, MD, president of the AMA, said in a press release.

The bills will be combined and are now headed to the Senate. President Obama said he supports the measures.

Chantix Data Don't Show Increase in Psychiatric Events

Smokers who take the smoking-cessation drug varenicline (Chantix) are no more likely to be hospitalized for psychiatric events than those who are using a nicotine patch to quit, according to data from two large government studies released Monday by the FDA.

However, that doesn't mean that the quit-smoking drug might not be to blame for mood changes including hostility, agitation, depressed mood, and suicidal thoughts or actions that don't end in hospitalization, the FDA cautioned in a drug safety communication posted to its website.

Neither of the studies reported Monday -- one of which was conducted by the Department of Veterans Affairs and the other by the Department of Defense -- found a difference in risk of neuropsychiatric hospitalizations between patients taking varenicline and those using nicotine patches to help quit smoking.

However, both studies had a number of design flaws, the FDA said, including testing only for neuropsychiatric events that resulted in a patient being hospitalized.

The FDA said the studies didn't rule out an increased risk for other neuropsychiatric events, including those that don't end in hospitalizations. Still, the benefits of varenicline continue to outweigh the risks, the FDA said.

Generic Olanzapine Wins FDA Approval

The FDA has approved a generic version of the atypical antipsychotic drug olanzapine (Zyprexa) to treat schizophrenia and bipolar disorder.

The approval paves the way for more people with the mental illnesses to receive treatment with the drug. For many, brand-name olanzapine, which costs upwards of several hundred dollars per month, is too expensive.

Olanzapine carries a box warning alerting doctors and patients to the risk of death in elderly people with dementia.

This past August, senators Herb Kohl (D-Wisc.) and Charles Grassley (R-Iowa) sent a letter to the Centers for Medicare and Medicaid Services (CMS) asking the agency to take a closer look at potential over-prescribing of atypical antipsychotics, such as olanzapine to nursing home residents, including those with dementia.

In 2009, brand-name olanzapine maker Eli Lilly paid a $1.4 billion settlement to the federal government for allegedly targeting doctors who worked in nursing homes and assisted living facilities to prescribe the drug off-label to elderly dementia patients.

Members of Congress Call for SGR Repeal

Two members of Congress called for a repeal of the sustainable growth rate (SGR), saying the time is particularly ripe to fix the flawed Medicare payment system.

The SGR system links physician reimbursement rates to increases in the gross domestic product (GDP). Because spending on physician services has outpaced increases in the GDP, the formula has called for cuts in reimbursements each year over most of the past decade -- and Congress has always voted to push those cuts down the road.

Reps. Allyson Schwartz (D-Pa.) and Phil Roe (R-Tenn.) held a meeting with several Washington budget and SGR experts: Mark McClellan, MD, of the Brookings Institution in Washington, who has also served as the head of CMS and FDA; Joe Antos of the American Enterprise Institute in Washington; and Stuart Guterman, of the Commonwealth Fund in Washington.

The current SGR "fix" is set to expire at the end of the year, meaning that come January 1, doctors face a 30% cut in reimbursements.

Antos predicted that Congress won't pass a new fix in time, so the current one will expire, but that CMS will hold payments until mid-January, when Antos said he thinks Congress will pass a new temporary fix.

But a temporary fix isn't good enough, the experts agreed, and they all pointed to reforming payments to doctors to reward quality instead of quantity as the key to creating a more workable system.

Super Committee Urged to Ban Prescription Drug Sweetheart Deals

The Federal Trade Commission (FTC) called on the congressional super committee to ban "pay-for-delay" deals between brand-name and generic drug companies as a way to bring down the federal deficit.

"Collusive deals to keep generics off the market are already costing consumers and taxpayers $3.5 billion a year in higher drug prices," said FTC Chairman Jon Leibowitz in a press release issued Tuesday.

The agency released new data this week showing that the practice of brand-name pharmaceutical companies paying generic competitors to agree to hold off on bringing their lower-priced generic version to the market doesn't show signs of slowing.

The FTC has unsuccessfully fought in court to ban pay-for-delay deals, and supports legislation that would make the deals illegal. The FTC argues that such deals are anti-competitive, violate antitrust laws, and result in the generic drug hitting the market 17 months later, on average, than generic drugs with no such agreement, making patients wait much longer for a more affordable drug.

But brand-name drug and generic companies vehemently defend the deals, and point out that the FTC and the Department of Justice have the authority to review any patent settlement agreements on a case-by-case basis.

The FTC called on the Joint Select Committee on Deficit Reduction (super committee) to focus on banning the deals to save money. The committee is tasked with identifying $1.2 trillion to $1.5 trillion in cuts from government spending.

Next Week

The American Public Health Association is holding its annual meeting to discuss current health science and policy issues to prevent disease and promote health.

Congress is also holding several health-related hearings, including a meeting of the super committee to review earlier debt reduction proposals, and a House Energy & Commerce hearing on Tuesday on whether the ACA threatens providers' conscience rights.

The FDA is also hosting a number of advisory committee meetings, including a Pediatric Oncology Advisory Committee meeting on Tuesday to discuss development plans for four products:

Adherex Technologies' sodium thiosulfate injection

Genentech's vismodegib

GlaxoSmithKline's pazopanib (Votrient)

MedImmune's Medi-573 (fully human antibody to IGF-I and IGF-II)

The panel will meet again on Wednesday to discuss issues surrounding the development of anticoagulant products in children.

On Tuesday, the FDA's Endocrinology and Metabolic Drugs Advisory Committee will discuss supplemental new drug applications for ezetimibe/simvastatin (Vytorin) and ezetimibe (Zetia). The proposed indication is to use ezetimibe in combination with ezetimibe/simvastatin to reduce major cardiovascular events in patients with chronic kidney disease. based on the results of the Study of Heart and Renal Protection trial.

The development of antibacterials for the treatment of community-acquired bacterial pneumonia

The treatment of hospital-acquired bacterial pneumonia, including ventilator-associated bacterial pneumonia

And on Friday, the FDA's National Mammography Quality Assurance Advisory Committee will hold a public hearing on a number of issues including accreditation body review of soft copy mammography images; reporting breast density on mammography reports; and patient lay summaries.

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